Sam Phillips founded Sun Records and was the legendary producer of Elvis Presley, Jerry Lee Lewis and Johnny Cash, among other artists who came to define 1950s rock and roll.
In a David Lettermen interview, Philips implied that his methodology for determining what the Sun Records sound should be was to basically just to record anyone who showed up at the studio.
Phillips opened his ears to unknown talent ignored by more commercial businesses that focused on repeating what already worked; his genius was knowing what people wanted to hear before they knew they wanted to hear it.
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A half-century or so later, Steve Jobs did the same thing with Apple, introducing a series of products with features consumers didn’t yet know they wanted.
Ironically, some would argue that the introduction of iTunes and computer-generated playlists took the heart and soul out of music discovery. If they were around in the 1950s, algorithms may never have found what Sam Phillips did.
Don’t Discount Your Gut
Perhaps there is a middle way. In the final analysis, social media is (for the most part) about the concerns and interests of real people. If you’re looking to identify the next business trends and opportunities, it’s a good place to start. But don’t discount “gut feelings,” because making a decision based on analytics alone won’t necessarily help you connect with the actual human beings behind those numbers.
To see why, let’s stick with the music industry. What’s Apple Music touting these days? Playlists curated by people rather than algorithms. Says Ian Gassman for Examiner.com:
Streaming services, including Apple Music, have been using curated playlists to stand out from each other. Not only can these playlists give listeners a valuable mix of tunes for specific occasions, but they’ve turned unknown artists into the next major revenue-generating streamer. Napster’s Sean Parker, for instance, posted a Spotify playlist that helped Lorde break out. According to Spotify statistics, the New Zealand pop star now has close to 4,500,000 monthly listeners on the site.
Combining the Best of Both Worlds
Finding the next “big thing” was what Sam Phillips excelled at. The business model of 300 Entertainment, founded in 2013, combines the talent scout abilities of actual human beings with data mining technology. Company founder Lyor Cohen describes it as a blend of old and new school approaches. A proprietary computer program monitors the Internet for songs that generate an unusual amount of activity—Facebook likes, retweets, iTunes traffic, link shares. When the program trips unusually high activity, Cohen says, “Then we listen to it.” If they sign the artist they listened to, and that artist proves successful, then they dispatch a crew of interns (note that they are using human beings, not web crawlers) to search the Internet for similar artists to sign.
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Some argue that touting human decision making is more a marketing tool than a verifiable advantage. Sam Phillips lived at a time when computers were housed in large rooms and fed key-punch cards to perform limited tasks. He didn’t have much competition. Today, people may be attracted to human-created playlists or actual talent scouts because, well, we’re human beings. In truth, algorithms might be better decision-makers.
What’s Data Good For?
For an example, let’s look at hiring. Bloomberg reports a National Bureau of Economic Research study of employee tenure based on whether the new hire was selected by an algorithm or a human being. The algorithm did a better job.
But the problem with this finding is that as data, that’s all it is. True, companies incur costs with high turnover and keeping employees longer is an objective. But what the data doesn’t tell us is whether the employees were effective at their jobs during the time they were there, or how well they got along with their colleagues and managers.
Perhaps there is an algorithm that does this. Still, while studies show that acting on human instinct is highly flawed, let’s not throw the baby out with the bathwater. Using your gut, or your human bias, is not the same as ignoring hard facts. Kazin Ladimeji reported for Recruiter:
You should still measure what’s measurable as a gut based decision is only as good as the decision data that has been fed in through the conscious mind. It’s actually about recognizing the complexity of the decision data and using both your conscious and unconscious mind in tandem to arrive at a better…decision.”
Develop Your Personal Radar
Look, these days we have more data than we know what to do with. Apple and 300 Entertainment rely on data to provide their services—but they don’t rely ITALICSonly on data. The problem with robots is they are, well, robotic. The Guardian quotes Sri Sharma, founder and managing director of paid search agency Net Media Planet: “I think of your instinct, your gut feeling, as a personal radar that is built up over the years. Often the data you analyze confirms the instinct of your personal radar, but it can’t replace it. Instinct is vital.”
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All of which is to say that if Sam Phillips were working for 300 Entertainment today, he might rely on a computer to point out listening trends. But only he could use that information to find the next Elvis Presley.